Capitalization of exclusive agricultural zoning into farmland prices

Using data from Rock County, Wisconsin, USA, on 140 farmland parcels selling in 1980 and 1981, this paper shows that exclusive agricultural zoning may have both positive and negative price effects and that these effects apply differentially depending on parcel characteristics. In the particular case examined, agricultural zoning is positively capitalized into land prices for large farmland parcels somewhat removed from urban areas, parcels without much development potential.